Nearly all of the focus of Mexico’s energy reform is on oil and gas drilling, but Mexico is seeking more U.S. and foreign investments to build new pipelines, expand refineries, construct petroleum storage and more, the Pemex CEO said.
Mexico’s population and economic growth means the United States’ southern neighbor needs much more growth in the energy transportation and refining sectors as well. The nation is facing shortages in both fuels and electricity generation, acknowledged José Antonio González Anaya, chief executive of Mexico’s national oil company, Petróleos Mexicanos, called Pemex.
“I think the potential is huge in the oil and gas sector in Mexico There’s a lot to do in the upstream, there’s a lot to do in the midstream, and there’s a lot to do in the downstream,” he said. “The array of projects are huge.”
Companies like Houston’s Kinder Morgan and others are building more natural gas pipelines to Mexico, while San Antonio’s Tesoro was just selected to provide more petroleum storage and transportation services. Many more projects are on the way.
Apart from China and India, Mexico is the largest economy still growing in fuel demand, González Anaya said. That just means there are more opportunities for trade and foreign investments.
Mexico opted in 2013 to undo Pemex’s 75-year old monopoly and open the country up to more international investments, including more partnerships between Pemex and other companies. This coincided with the two-year oil bust, so Pemex has had to slash its budget and roughly 30,000 jobs. That means more partners are needed to fund the necessary growth.
“The energy reform is a huge opportunity for everyone, the U.S. included,” he said. “We already have an important oil and gas trade, and I think the opportunity is there to grow even more.”
Pemex already has Houston offices and he expects its Houston presence “probably” will grow. Pemex’s only refinery outside of Mexico is actually outside of Houston in Deer Park. Pemex owns 50 percent of Royal Dutch Shell’s Deer Park Refinery.